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Tag: debt financing

Gannett to refinance $1.05B in debt

McLean-based Gannett Co. Inc., the largest newspaper publisher in the U.S., announced Monday it will refinance $1.05 billion in debt to lower its interest rates and extend maturity on outstanding debt.

Gannett, which has struggled financially during the pandemic, in November 2020 announced it had refinanced approximately $500 million in debt to more quickly repay outstanding loans. The company is refinancing its 11.5% term loan to improve its balance sheet and “overall capital structure,” according to a company statement. This is expected to result in approximately $90 million in cash interest savings this year.

The company in early April 2020 announced it was in negotiations with its vendors, creditors and pension regulators to preserve Gannett’s liquidity. Gannett was noticeably missing from the Fortune 1000 list released in May 2020.

“Refinancing our original term loan was our No. 1 priority since closing the acquisition of Gannett Media Corp. in November 2019 and we are thrilled to have been able to do so this early into 2021, which is well ahead of our original target date,” Gannett Chairman and CEO Michael Reed said in a statement. “We will continue to make reducing our outstanding debt a top priority, with a goal of reaching first lien net leverage below 1.0x over the next two years.”

Gannett also announced mass layoffs, furlough and pay cuts in late March due to the COVID-19 pandemic. The owner of USA Today, Gannett has a portfolio of 261 local daily newspapers in 46 states and Guam, including the Arizona Republic, the Des Moines Register and the Burlington Free Press.

 

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Hilton to sell $1.9B in debt in private offering

As hotel industry revenues continue plummeting, McLean-based Hilton Worldwide Holdings Inc. announced this week it will sell $1.9 billion in debt in a private offering to institutional buyers. 

The hotelier will sell $800 million of senior notes (due in 2029) at a 3.75% interest rate and an additional $1.1 billion at a 4% rate. Those will be due in 2031. 

Hilton will use the proceeds from the offering to redeem all of its outstanding 4.25% senior notes due in 2024 and use the remaining proceeds to redeem its outstanding 4.625% senior notes due in 2025, according to a company statement.

Hilton, like other hotel companies, has struggled since the onset of the pandemic. In June, Hilton announced it was laying off 2,100 corporate employees — more than 20% of its corporate workforce. Due to the economic crisis, Hilton’s first-quarter revenues dropped by $284 million compared with 2019, with decreases continuing through the second quarter. The company reported slight improvements during the third quarter, but still saw a net loss of $81 million when compared with last year.

“While a full recovery will take time, we are well-positioned to capture rising demand and execute on growth opportunities,” Hilton President and CEO Christopher J. Nassetta, Virginia’s highest-earning CEO in 2019, said in a Nov. 4 statement. Nassetta brought home $21.37 million in total compensation, while Hilton’s 2019 median pay for employees was $43,695.

The senior note offerings are expected to close on Dec. 1, according to Hilton.

 

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Gannett announces $500M debt refinancing

McLean-based Gannett Co. Inc., the largest newspaper publisher in the U.S., announced Tuesday it has refinanced approximately $500 million in debt to more quickly repay on outstanding loans.

Gannett announced in early April that it was negotiating with its vendors, creditors and pension regulators in order to preserve the company’s liquidity. It was noticeably not on the Fortune 1000 list released in mid-May.

The company refinanced the loan with New York-based private equity firm Apollo Global Management.

“Working collaboratively, we crafted a creative approach to address Gannett’s desire to rapidly strengthen its balance sheet,” Robert Givone, Apollo partner and co-head of opportunistic credit, said in a statement. “The refinancing is indicative of the types of capital solutions that Apollo is uniquely situated to provide to great companies.”

Gannett Chairman and CEO Michael Reed says the refinancing’s benefits include generating savings and extending the debt maturity by three years. 

“Since putting the term loan in place in November 2019, we have repaid over $175 million to date, and we expect to repay an additional $100 million in the coming months,” Reed said in a statement. 

The refinanced portion of Gannett’s debt has a 6% interest rate and a 2027 maturation date. It was originally at 11.5% and due in 2024. The company will still owe Apollo nearly $1.12 billion.

“Pro forma for these repayments, the outstanding term loan will be approximately $1 billion, which we believe we can refinance on attractive terms by the end of the first half of 2021,” Reed said in a statement. “As we improve the company’s capital structure, we are also seeing continued improvement in our revenue trends, which we expect will drive strong fourth quarter results.”

The refinancing was unanimously approved by Gannett’s board of directors. Greenhill & Co. LLC and Cravath, Swaine & Moore LLP advised Gannett during the transaction.

Gannett also announced mass layoffs, furlough and pay cuts in late March due to the COVID-19 pandemic. The owner of USA Today, Gannett has a portfolio of 261 local daily newspapers in 46 states and Guam, including the Arizona Republic, the Des Moines Register and the Burlington Free Press.

 

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Tegna raises $550M in debt financing

Tysons-based broadcast and digital media company Tegna Inc. announced Thursday it has raised $550 million in debt financing, which will go to pay outstanding debt.

“With this successful offering, Tegna has reduced our overall average borrowing costs and locked in a lower fixed interest rate as we did earlier this year, further strengthening our balance sheet as part of advancing our five-pillar strategy to drive long-term value creation,” Tegna President and CEO Dave Lougee said in a statement.

The company intends to use the net proceeds to repay the entire $350 million aggregate principal amount of its 4.875% senior notes due 2021 and $188 million aggregate principal amount of its 5.5% senior notes due 2024. Tegna will also use the funding for the redemption premium on its 5.5% senior notes due 2024, according to a company statement.

In March, the Fortune 1000 company announced that two offers to acquire the company had fallen through. Tegna had received four unsolicited acquisition offers, three of which were reportedly worth about $8.5 billion apiece. Offers included a joint proposal from investment firm The Najafi Cos. and religious broadcaster Trinity Broadcasting Network; and an offer from TV producer Byron Allen’s Allen Media Group. Other bidders included private equity firm Apollo Global Management Inc. and Gray Television Inc.

Once part of McLean-based Gannett Co. Inc. (the nation’s largest newspaper publisher), Tegna owns 62 television stations and four radio stations in 51 markets and its programming reaches 41.7 million television households.

 

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